Combine powdered sugar and enough milk, 1 tablespoon at a time, to make medium-thick pourable glaze. Spread small amount of glaze over stars and place on waxed paper; let stand until glaze is set. Using red and blue food colorings, tint 1/2 of glaze red, tint 1/4 of glaze blue and leave remaining 1/4 of glaze white.

Decorate hat with red, white and blue glazes as shown in photo; arrange stars on blue band of hat. Let stand until glaze is set.